Asylum seekers housed in Delta compound look on from behind a fence as a court appointed party inspects the Manus Island detention centre in 2014. Image: SBS/AAP

By Kerrie Armstrong

An independent audit has slammed the Australian Department of Immigration’s running of the Nauru and Manus Island detention centres, saying department officials spent A$1.1 billion without authorisation.

The audit, by the Australian National Audit Office (ANAO), criticised the department’s management of contracts relating to the offshore detention centres.

It found there was no clear system for the management of “garrison support and welfare services” at the two centres, while “significant shortcomings in the contractual framework” meant the department did not get value for money.

“The department did not put in place effective mechanisms to manage the contracts,” the audit found.

“Other than the contracts, there was no documentation of the means by which the contract objectives would be achieved.

“$1.1 billion was approved by DIBP officers who did not have the required authorisation.

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“In the absence of a plan, assurance processes such as the inspection and audit of services delivered, has not occurred in a systematic way and risks were not effectively managed.”

No departmental record
When it came to payments, the audit said the department had an appropriate framework in place, but that it did not always work as it should, allowing for $2.3 billion in unauthorised payments to be made between September 2012 and April 2016.

“An appropriate delegate provided an authorisation for payments totalling $80 million; $1.1 billion was approved by DIBP officers who did not have the required authorisation; and for the remaining $1.1 billion there was no departmental record of who authorised the payments,” the audit found.

“Substantial contract variations totalling over $1 billion were made without a documented assessment of value for money.”

The department, however, disagreed with the audit’s findings in a statement to the report.

“The department is committed to robust and effective procurement and contract management, and would dispute any suggestions that it spent $2.3 billion without proper authorisation,” the statement said.

“The vast majority of these payments were fixed monthly contractual fees which are dependent on the numbers of residents in the RPCs.

“The department also disagrees with claims that additional service requests and contract variations were made without consideration of value for money or if funds were available.”

Contractual deficiencies
The audit noted the Immigration Department had been managing contracts since 1997, and previous audits had found deficiencies in the way the contractual framework it had established.

“This audit has identified a recurrence of these (and other) deficiencies, which have resulted in higher than necessary expense for taxpayers and significant reputational risks for the Australian Government and the department,” it found.

The audit also found there was a lack of detail in the welfare service contracts, that there were no clear guidelines for the implementation of contracts and plans and a lack of clarity in contract roles, responsibility and organisational hierarchy.